1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
avanturin [10]
3 years ago
12

Antiques R Us is a mature manufacturing firm. The company just paid a $9 dividend, but management expects to reduce the payout b

y 8 percent per year, indefinitely. If you require a 14 percent return on this stock, what will you pay for a share today?
Business
2 answers:
Anton [14]3 years ago
6 0

Answer:

The amount to be paid for the stock: $1.82

Explanation:

The value of a stock is the present value of future cash flows expected from the stock discounted at the required rate of return.

Where dividend is expected to decline by an annual rate , the price of  a stock can still be determined using the dividend valuation model, but with a provision for a negative growth rate in dividend.

With a negative growth rate, the model is modified as follows:

P = D×(1-g) /(r - (-g))

D- 9, g - 8%, r- 14%

P = 9× (1-0.08)/(0.14-(-0.08)

  = $1.8216

The amount to be paid for the stock: $1.8216

ArbitrLikvidat [17]3 years ago
5 0

Answer:

I will pay $40,9 for the share today

Explanation:

Dividend Valuation method is used to value the stock price of a company based on the dividend paid, its growth rate and rate of return. The price is calculated by calculating present value of future dividend payment.

Formula to calculate the value of stock

Price = Dividend / ( Rate or return - growth rate )

Price = $9 / ( 14% - (-8%) )

Price = $9 / 14% + 8%

Price = $9 / 22%

Price = $40.9

You might be interested in
Question 2 of 10
11111nata11111 [884]

Answer:c

Explanation:

8 0
3 years ago
Read 2 more answers
why might a mutual fund be a better investment than individual stock and bonds a mutual fund guarantees dividends be stocks are
borishaifa [10]

Answer:

The correct answer would be option C, The risk is diversified with a mutual Fund.

Explanation:

Mutual funds is a pool of funds from different people. This pool of fund is invested in different securities. These securities can be stocks, bonds, treasury bills, etc. In this way the risk is diversified. When you invest money with the money of other people, the pool of money or funds will minimize the risk associated with investing a single person's money in any security. Secondly, the mutual funds are managed by professionals who are expert in the field of managing funds. They better know when and how much funds to liquidate and at what time.

7 0
3 years ago
Mary has increased her​ __________ skills that now allow her to​ access, interpret,​ summarize, and communicate data more effect
stepladder [879]

Answer:

Mary has increased her data literacy skills that now allow her to​ access, interpret,​ summarize, and communicate data more effectively.

Explanation:

Data analysis is the process by which data is transformed in such a way that useful information can be extracted from it. Data analysis is a key skill that is needed in most business nowadays, for example; financial data can be very crucial in the planning, budgeting and execution of projects. The process of data analysis has been automated to take raw data and produce a result that can be readily consumed easily by humans in the form of charts and graphs. From this end result, conclusions can be drawn by data experts on what the results mean.

Experts in data analysis are therefor needed to adequately access, interpret, summarize and communicate data more effectively. These are skills that need to be learned for better overall quality of the data presentation. In general, the principals are referred to as data literacy skills. Data literacy can be defined as the ability of an individual to extract useful information from raw data.

3 0
3 years ago
When deciding how to deal with negative feelings, why should you evaluate the causes of your issue??
vampirchik [111]

<span>You might be able to cope with future issues more easily this the correct answer. : )</span>
3 0
4 years ago
Read 2 more answers
A client/server network is an example of ________ administration
sladkih [1.3K]
<span>A client/server network is an example of Central administration
In computer network, a central administration refers to something that enabled several computers to be connected under a single medium.
An example of The real life implication of a client/server net work is the system that we use for online multiplayer gaming</span>
4 0
3 years ago
Other questions:
  • You have been given the following information for Corky’s Bedding Corp.: Net sales = $12,250,000. Cost of goods sold = $8,900,00
    7·1 answer
  • Which of the following is an example of capital substitution? A. having robots on an assembly line instead of workers B. trade t
    5·1 answer
  • The minimum insurance required is ______ for personal injury or death to any one person, ______ for death or injury to more than
    12·1 answer
  • Simpkins Corporation does not pay any dividends because it is expanding rapidly and needs to retain all of its earnings. However
    9·1 answer
  • Which of the following is a generic term that denotes the broad range of possibilities of product​ attributes? A. Offering B. Va
    10·1 answer
  • In order to save time, money, and effort a group of criminologists, sociologists, psychologists, and political scientists combin
    5·1 answer
  • Greg is planning an advertising campaign to promote his kayak tour company. The success of his ad campaign depends on ________.
    8·1 answer
  • Peach Company uses a weighted-average process-costing system. Company records disclosed that the firm completed 40,000 units dur
    14·1 answer
  • Define federal deposit insurance corporation.​
    14·1 answer
  • consumers are the subsegment of all Internet users who employ this technology to research products and services and make purchas
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!